Taiwan's PCB giant Unimicron is under criminal investigation for allegedly relabeling China-made boards as "Made in Taiwan," bad news for its shareholders and a warning shot for every Taiwanese company still making parts in China.

• Prosecutors searched Unimicron and questioned 14 people over faked origin labels; five were released on bail, including senior managers.
• The stock had just hit a record high before crashing late Friday, and funds and ETFs holding it are now exposed.
• The bigger story is Washington's crackdown on the "red supply chain" — a string of recent Taiwanese and US cases all trace back to American pressure.
• The gray zone Taiwanese firms used to operate in, making parts in China and selling them as Taiwanese, is closing fast.
• Unimicron's actual business is still strong, with second-quarter profits high and demand for its advanced chip substrates holding up.

Outlook: The share price will likely take a short-term beating, but solid earnings should carry the company through, while other Taiwanese manufacturers with China plants face tighter scrutiny.